GM terminates relationship with key adviser to CEO Mary Barra after controversy

General Motors CEO Mary Barra is terminating her company’s relationship with a high-profile adviser and his consulting firm after a controversial incident involving his “inappropriate” drunken behavior at a charity event that made global headlines.

Declan Kelly, an influential strategist to Fortune 500 executives, including Barra, has said fallout from the May incident has inspired him to take time away over the summer from the Teneo global consulting firm he co-founded and runs as CEO, according to the Irish Times.

“Following a series of discussions, General Motors has decided to no longer engage with Teneo,” GM spokesman David Barnas told the Free Press on Friday afternoon.

The Detroit automaker signed a contract with the Teneo firm within the past two months for an estimated $250,000-per-month retainer. An auto industry source says that rate is not uncommon for well-known consultants based on the East Coast. Teneo is based in New York with an office in Dublin.

Kelly’s expertise involving GM focused on government relations and executive positioning, sources with knowledge of the situation confirmed. Kelly and his team worked directly with Barra in addition to other top-level GM executives.

The incident raises questions about the future of Teneo, The Irish Times reported.

International news stories said the public relations firm reached out to its clients on Thursday.

That included GM.

“We can confirm that we have engaged in a series of conversations today with Teneo,” Barnas told the Free Press late on Thursday night. “We are determining next steps.” 

A day later, the relationship was over.

GM appears to be among the first clients to publicly announce plans to end the business relationship. Financial news outlets have questioned the potential impact of a CEO who specializes in reputation management stepping away amid scandal.

The Financial Times cited the Free Press article that first reported GM having internal discussions about how to handle the matter.

Still, as of Friday afternoon, Kelly was listed as being responsible for running all of the company’s operations globally.

The incidents that led to the controversy occurred at a cocktail party for the anti-poverty charity Global Citizen on May 2, where Kelly “became inebriated and behaved inappropriately toward some women and men at the event,” a spokesperson for Kelly told the Financial Times.

Barra was not at the event, Barnas told the Free Press.

Kelly was removed from the board of Global Citizen the day after the incident at the event, which was also attended by fellow board members, and an investigation into the matter is ongoing, according to the Financial Times.

While Kelly remains CEO of the firm headquartered in New York City, he has “temporarily reduced his work responsibilities,” according to the IrishCentral.com.

A Teneo spokesperson said that Kelly “deeply regrets his actions” and has apologized to those he offended. 

Kelly is “committed to sobriety” and was “undertaking ongoing counseling from health care professionals,” his spokesperson said.

According to a statement put out by a spokesperson for the chief executive, Mr. Kelly “became inebriated and behaved inappropriately toward women and men,” according to the Irish Independent newspaper.

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He apologized to his staff on Thursday, saying he plans to focus on his health.

“Please know I will be back in a full capacity in September and remain as committed as ever to Teneo,” according to PageSix.com.